Sat, 27th May 2017

Anirudh Sethi Report


Archives of “john major” Tag

Merkel victory in German state election

Plenty of politics in the early part of the forex week

French election, of course,
  • French election results, official counts coming now 
  • Macron wins French election – EUR higher (early price indications)
  • French election results – Le Pen concedes defeat
And, in Germany –
An election in the German state of Schleswig-Holstein:
  • Chancellor Merkel’s conservative party won, her  Christian Democrats on 33-odd % of the vote (initial result)
  • The Social Democrats had been in power, but only won 26.5%
Polls had been predicting a much tighter result, so an outperformance by Merkel’s party here
And, while your here, rates update:

Tony Blair leaves door open to second referendum on EU membership

Former British prime minister Tony Blair has hinted at his support to have a second referendum if a “significant part” of those who voted for Brexit change their mind.

Speaking to launch his campaign to “persuade” people not to leave the EU, Mr Blair said:

If a significant part of that 52 per cent show real change of mind, however you measure it, we should have the opportunity to reconsider the decision.

Whether you do it through another referendum, or another method, that’s a second order question.

The former leader of the Labour party also invoked the “propensity for revolt” seen across the developed to call on pro-EU supporters to convince people who “voted without knowledge of the true terms of Brexit”.

Mr Blair said he wanted to “strengthen the hand of the MPs who are with us and let those against know they have serious opposition to Brexit At Any Cost”, adding:

This is not the time for retreat, indifference or despair; but the time to rise up in defence of what we believe – calmly, patiently, winning the argument by the force of argument; but without fear and with the conviction we act in the true interests of Britain.

David Cameron warns of “tough” EU negotiations

The prime minister, speaking to reporters outside the meeting room, said he would deliver all the pledges in the Conservative manifesto — he was brandishing a copy in his hand — and spoke of his desire to lead a government of “compassionate Conservatism” that brought the UK together

The prime minister also indicated that his election success should strengthen his hand in the negotiations on EU reform.

“We have got a mandate,” he said. “It’s going to be tough but we have a mandate.”

Midway through his reshuffle when he broke off to address MPs, the prime minister promised to run a “ministry of all the talents” as he continued to assemble his new government.

Mr Cameron has promoted loyalists such as Amber Rudd but has also brought in flagbearers of the right of the party such as John Whittingdale, secretary of the 1922 committee and a leading eurosceptic.

Mr Cameron told reporters he knew the Tories had won when they held Nuneaton — describing it as the equivalent of Basildon in John Major’s 1992 victory.

But he also admitted that YouGov’s daily deadlocked polls had been a source of frustration to him during the campaign. “I am going to sue them for my ulcers.”

EU casts shadow over Cameron’s election success

David Cameron barely had time to toast his stunning election victory before attention turned to Britain’s future in Europe and the onerous task of quelling rebellious eurosceptics within party ranks.

During his victory speech, Prime Minister Cameron said he would stick to his pledge to hold an in-out referendum on Britain’s European Union membership by the end of 2017.

Cameron will campaign to stay in the union, but only if he can secure reforms such as changes on migration and benefits, and the repatriation of certain powers to London.

However, he will have to simultaneously appease his European partners and the anti-EU faction of his own party, whose influence is amplified by the Tories’ narrow majority of just 12 seats.

“Every step of the way he will have to manage a caucus of up to 100 eurosceptic rebels who are not likely to be satisfied with merely tearing up red tape,” warned the Times editorial on Friday.

Cameron held sway over his MPs during the last parliament as his coalition with the centrist Liberal Democrats gave him a sizeable majority, diluting the influence of backbenchers.

The new situation has raised comparisons with that of former prime minister John Major, who was tormented by Tory rebels during Maastricht Treaty negotiations, famously calling three of his own cabinet members “bastards”.

Spain is turning into the new Greece, and Mariano Rajoy has himself to blame

When the economic situation is bad (the country’s GDP estimates fell again on Wednesday) there’s nothing like a dose of political mismanagement to give things a good hard shove towards the same abyss that Athens disappeared into sometime in the middle of last year.

It’s only September but the scenes from Madrid in recent days prompted me to revisit the annual predictions in which we indulge every January. At the start of the year, as we looked forward to another 12 months of experimental eurozone economics, not to mention politics, with renewed austerity measures and another euro treaty, this column said: “None of this has been tested at the ballot box and I predict a year of popular political protest across the eurozone, some of which will turn violent, prompting shocking scenes as governments use force to regain order.”

You can’t let a gun off slowly, but Spanish prime minister Mariano Rajoy has been openly flirting with the idea of seeking a bail-outfrom the European Central Bank in recent days but only if capital market investors forced Spain into it by sending yields on Spanish government debt higher.

In the land of bull fighting, he has waved the proverbial red rag. Lo and behold, Spanish bond yields duly shot up again on Wednesday to 6pc, pricing Spain out of the markets and forcing him closer to going cap in hand to Frankfurt, assuming the ECB bail-out is actually real as opposed to an empty promise. This, in turn, will undermine his political credibility at home which the riots in Madrid and secession fever in Cataloniareveal is already suffering. Read More